Definition: CPC, or Cost Per Click, is a digital advertising metric that measures the cost an advertiser pays each time a user clicks on their online ad. It is commonly used in pay-per-click (PPC) advertising campaigns, such as Google Ads, where advertisers bid on keywords relevant to their target audience.
Calculation: CPC is calculated by dividing the total cost of an ad campaign by the number of clicks the ad receives. The formula is: CPC = Total Cost of Campaign / Total Number of Clicks. This metric helps advertisers understand the effectiveness and efficiency of their ad spend.
Importance: CPC is crucial for budget management and campaign optimization in digital marketing. A lower CPC indicates a more cost-effective campaign, allowing advertisers to achieve more clicks within their budget. It also aids in comparing the performance of different ads or keywords to maximize return on investment (ROI).
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